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Banks don’t focus enough on user experience in transaction disputes

Banks don’t focus enough on user experience in transaction disputes

Recent work[1] by McKinsey and Company has shown that banks improving their customer experience generate more revenue than their peers.

Focus on user experience in transaction disputes

While customer service, especially in the digital channel, has been a long-term focus for banks, the process of disputing transactions remains stressful, complicated and time-consuming for customers.

At the same time, the cost and complexity of dispute resolution remains a significant pain-point for banks seeking to improve their profitability and retain customers.

As digitalisation and automation continue, Andreas Jansson, Senior Product Manager at Nets argues there’s too little focus on customer satisfaction in transaction disputes. With competition growing fast, banks need to act.

In a new white paper, we argue banks must digitalise and automate how customers begin the process of disputing potentially fraudulent or erroneous transactions.

Citing research[2] that proves dispute resolution costs US and British banks almost $10 billion each year, we explain how banks can reduce cost, streamline the disputed transaction process and improve customer satisfaction by automating the initiation of customer disputes.

For most consumers initiating a dispute means trying to find information on websites, calling their bank, filling in forms or visiting a branch – all while in a somewhat distressed mood.

Add to this the high likelihood of several different communications with the issuer before that bank has all information necessary to process the claim, and it’s easy to see how consumers might opt for a different payment method next time.

In Digitalised dispute resolution: why the customer journey is crucial, we explain that current efforts have focused too much on internal bank processes, rather than the customer experience.

What’s more, with disputes rising by 300% in some verticals since COVID according to FIS[3], modernising the way customers register their disputes is going to be an increasingly important part of a bank’s overall service offering.

The difficulties customers face in suffering fraud are not made better by complicated initiation requirements, poor transparency on the part of banks and slow resolution times. Some banks can be slow to communicate with customers, or to offer alternative payment methods when cards are blocked to prevent further fraud. At present, the user experience in dispute resolution is almost completely ignored – something banks can ill afford given huge competition for share of wallet from Non-Bank Financial Institutions (NBFIs) and alternative payment methods not linked to card rails.

Our new white paper explains that banks must now digitalise and automate the initiation of disputed transactions for customers. In doing so, banks will improve customer satisfaction and loyalty, as well as saving time and money.

What’s more, automated initiation enables further automation of internal processes for banks: dispute handling speeds are improved and dispute resolution can be centralised away from specific departments or call centres.

At Nets, we have deep experience of working with leading retail banks on digitalising customer initiation in the dispute resolution process.

For most banks, digital customer initiation for disputes is a major area in which massive gains in efficiency, cost and customer satisfaction can be made.

At a time when the number of disputes is rising fast and competition from non-bank actors and FinTechs is growing, digitalising customer initiation is an important means of improving customer satisfaction and delivering better service while reducing human inputs and cutting the cost of dispute resolution for your bank.

Download a free copy of “Digitalised dispute resolution: why the customer journey is crucial” now

[1] See Forbes, 7 September 2020, “Proving the ROI of Customer Experience investment”

[2] See “The Chargebacks Triangle”

[3] See FIS, “Chargeback Q&A”

The post Banks don’t focus enough on user experience in transaction disputes appeared first on Payments Cards & Mobile.

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